PV market pickup forecast for 2H 201330. October 2012 | Applications & Installations, Global PV markets, Industry & Suppliers, Markets & Trends | By: Becky Beetz
New photovoltaic installations worth over 31 GW are predicted for 2012, despite continuing overcapacity and price declines. Forecasts are that the global industry will return to growth in Q2 2013, and will regain lost ground in Q4.
In its latest PV Integrated market tracker report, IHS iSuppli has found that new photovoltaic installations will grow by around 11% on 2011, which installed 28 GW.
Demand is not thought to be strong enough to quell the price declines this year however, despite the Q2 installation surge seen in Germany, which helped push global installations from 4.9 GW in Q2 2011, to 8.2 GW.
This increased demand was said to have temporarily helped slow cell and module price declines. However, cooling demand in Q3 has seen them once again accelerate and IHS does not expect them to stop by the end of the year.
Overall, global revenue for the photovoltaic module market is said to have fallen for the first time this year, from US$7.03 billion in Q1 and $7.14 billion in Q2, to $6.63 billion in Q3. For the last 2012 quarter, revenues are predicted to further slip to $6.62 billion. Q3 module prices were said to have fallen by 14%.
In Q4, IHS expects to see crystalline module prices falling by a further 9%, to $0.64/W, down from $0.70 at the end of September. This situation is expected to ease off in 2013, with average crystalline prices forecast to hit $0.55/W in Q4.
"The industry will return to growth only by the second quarter next year, finally regaining lost ground by the fourth quarter when [module] revenue springs back to an estimated $7.06 billion – just slightly more than when the market started in the first quarter this year," said IHS in a statement released. It added that operational module manufacturing capacity is forecast to reach 51.9 GW in 2013.
In addition to module price declines, wafer prices were said to have decreased 11% in Q3 2012, and cell and polysilicon prices 17%.
Factors affecting prices
On top of overcapacity, strong installation demand in China and reduced Chinese module exports will serve to push global prices down further, said IHS. "While many delayed solar projects in the country will be implemented during the remainder of the year and help improve global installation figures, China is a low-priced market. As a result, even a strong fourth quarter in China won’t induce a recovery in prices," said Stefan de Haan, Principal Analyst at IHS.
He added, "Chinese manufacturers are already reducing module shipments to Europe, in response to a European Commission investigation on anti-dumping charges of crystalline modules, cells and wafers originating from China. In exchange for the voluntary reduction of shipments from China, European wholesalers will aim to reduce their dependency on Chinese suppliers in the coming months and balance their portfolio."
Overall, IHS does not expect European duties to be imposed, but does believe that pricing pressure on Chinese suppliers in Europe will be increased, due to uncertainty until the final determination is made in December 2013.
As aforementioned, the photovoltaics market is expected to pick up in 2H 2013, with overcapacity easing. For the full year 2013, IHS expects to see global photovoltaic installations increasing by around 10%, with China and Japan in particular, making up for weakening European demand.
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